TO: Proximity Social Networking team
FROM: Paul Miers
DATE: February 22, 1010
SUBJECT: MySpace strategy analysis ___
Here is my MySpace strategy analysis. Although MySpace no longer dominates the Social Networking market, it is now in a position to change their business strategy and become a Music social networking website. MySpace needs to change their business strategy, or continue to lose users to Facebook.
Profile
MySpace is a social networking website that was launched in August 2003 by Tom Anderson and Chris DeWolfe. It was sold out to News Corp. in 2005 for $580 million and now it operates as part of News Corp. Now MySpace is trying to change their business strategy and become a social entertainment outlet for people to connect with friends over music and videos.
MySpace revenues solely come from advertising, other than that MySpace is completely free to all its users. MySpace currently has over 200 million accounts, and is expected to generate more than $800 million, but currently their revenue is flat.
Competitive landscape
The primary force driving competition in the social networking market is the consumer power. The more users MySpace get, the more advertisement deals it will get. MySpace users are not signed on a contract therefore they are able to switch to another social networking site.
Since 2006-07, MySpace has intense competition mainly from Facebook, but also from other social networking web sites (like; Friendster, Linkdln, and Twitter). MySpace lost many of its users to Facebook, due to Facebook’s cleaner design (and the inability of users to change it), the security settings (which are tighter), practically no spam, and finally Facebook’s ability to adapt and change accordingly for the user’s benefit.
MySpace Strategy
MySpace is currently stuck, they are trying to change and become a social networking music website, where people will connect over videos, movies, bands (virtually YouTube). MySpace offers its users to design their own page (include widgets, videos, music players, movies, slides, pictures, blogs). You can tell people what you are currently doing (status update), and show your emotions (by using the icons).
Gen-Y Implications
The biggest question we have for MySpace is: Are they going to die out (and be beat by Facebook), or are they going to switch their strategy and become a niche social networking website. In order to compete with Facebook, MySpace needs to clean out their design, make it more efficient for users, and change from being a site that has anything and everything to a niche market social networking site.
If they continue to “copy” Facebook, and add more and more widgets to the site, it will eventually lose the fight to Facebook.
TO: Proximity Social Networking team
FROM: Paul Miers
DATE: February 22, 1010
SUBJECT: MySpace strategy analysis
___
Here is my MySpace strategy analysis. Although MySpace no longer dominates the Social Networking market, it is now in a position to change their business strategy and become a Music social networking website. MySpace needs to change their business strategy, or continue to lose users to Facebook.
Profile
MySpace is a social networking website that was launched in August 2003 by Tom Anderson and Chris DeWolfe. It was sold out to News Corp. in 2005 for $580 million and now it operates as part of News Corp. Now MySpace is trying to change their business strategy and become a social entertainment outlet for people to connect with friends over music and videos.
MySpace revenues solely come from advertising, other than that MySpace is completely free to all its users. MySpace currently has over 200 million accounts, and is expected to generate more than $800 million, but currently their revenue is flat.
Competitive landscape
The primary force driving competition in the social networking market is the consumer power. The more users MySpace get, the more advertisement deals it will get. MySpace users are not signed on a contract therefore they are able to switch to another social networking site.
Since 2006-07, MySpace has intense competition mainly from Facebook, but also from other social networking web sites (like; Friendster, Linkdln, and Twitter). MySpace lost many of its users to Facebook, due to Facebook’s cleaner design (and the inability of users to change it), the security settings (which are tighter), practically no spam, and finally Facebook’s ability to adapt and change accordingly for the user’s benefit.
MySpace Strategy
MySpace is currently stuck, they are trying to change and become a social networking music website, where people will connect over videos, movies, bands (virtually YouTube). MySpace offers its users to design their own page (include widgets, videos, music players, movies, slides, pictures, blogs). You can tell people what you are currently doing (status update), and show your emotions (by using the icons).
Gen-Y Implications
The biggest question we have for MySpace is: Are they going to die out (and be beat by Facebook), or are they going to switch their strategy and become a niche social networking website. In order to compete with Facebook, MySpace needs to clean out their design, make it more efficient for users, and change from being a site that has anything and everything to a niche market social networking site.
If they continue to “copy” Facebook, and add more and more widgets to the site, it will eventually lose the fight to Facebook.
References
Dignan. Larry. Fox Interactive turns annual profit; Myspace revenue to top $800 million in fiscal 2008. (2007, August 8).
http://blogs.zdnet.com/BTL/?p=5899
Kyle. 10 Reasons why Facebook has Myspace's Number. (2007, June 11).
http://www.wisdump.com/business/10-reasons-facebook-has-myspaces-number/
Thaeler, Janet. News Corp Loses $6.4 billion Myspace Revenue is Flat. ( 2009, February 6).
http://www.marketingpilgrim.com/2009/02/news-corp-loses-64-billion-myspace-revenue-flat.html
Wikipedia. MySpace.
http://en.wikipedia.org/wiki/MySpace#Revenue_model